Non Us Companies Filing Us Stock Financials Essay

1991 Words Dec 4th, 2014 8 Pages
Assignment 1 –FAC501 |

Challenges facing the accounting profession and how I see them affecting me in the future with regards to IFRS companies submitting IFRS on US stock exchanges?

Macdonald Felix Rusoto Muchemedzi
Student Kaplan University

As the Stock exchange affords different investors the opportunity to actively trade in the non-US companies and also provide an avenue for non-US companies to raise capital will the investment and accounting community be able to fully understand the information and make rational and informed decisions. In this discussion paper I will discuss the key requirement that participants should be financial bilingual to fully understand both sets of financial reports (IFRS and USGAAP) in order to
…show more content…
The principal quality features in both are the same albeit different names.
In IFRS the two main qualities are
1-Relevance
2-Faithfulness
And in USGAAP
1-Relevance
2-Reliabilty
And the secondary qualities in both are Comparability and Consistency.
Faithfulness and Reliability compared
Faithfulness under the IFRSCFW is all about reporting the” economic phenomena” in words and numbers (Conceptual Framework, paragraph QC12.)Therefore the information must represent the events it purports to represent and the CFW highlights that the following three characteristics for information to be faithfully presented
1-Completeness
2-Neutrality
3-Free from error

Were as reliability under USGAAP is “Accounting information is reliable to the extent that it is verifiable ,is a faithful resprestation, is reasonably free from error and bias ”(Intermediate Accounting: Principles and Analysis ,2nd Edition, page 40,Warfield etal).

Summary of the components of reliability and faithful ness

Faithful Representation CFW_IFRS | Reliability-USGAAP_FW | * Completeness | * Faithful presentation | * Neutrality | * Substance over form | * Free from error | * Neutrality | | * Prudence | | * Completeness | As can be seen from the above summary

Related Documents